Spinal specialist Arthro Kinetics plc is expanding into China. This follows the company's recent strategic alliance with Australian Biotechnologies Pty Ltd, Sydney, to manufacture the bio-implant products developed by both companies and to distribute them in Australia and New Zealand (see also,

The UK company said it signed a memorandum of understanding for the establishment of a joint venture with Tianjin Anda Group Holding Co Ltd for the commercialization in China of its CaReS biological cartilage regeneration products. The joint venture will produce CaReS products using the three-dimensional collagen matrix developed by Arthro Kinetics. It will be supplied from the company's GMP facility in Krems, Austria.

Arthro Kinetics will own about 15% of the joint venture, which is valued initially at 14 million [euro]. There will be an equity injection of about 10 million [euro] by Tianjin Anda and the transfer of know-how and rights relating to CaReS by Arthro Kinetics to the joint venture. The company expects to gain revenues from the matrix sales to the new business, along with a royalty of 2% of net sales.

The company expects the construction of an implant production facility to be completed by the end of 2007. While construction work is going on, the joint venture will apply to the China National Foods & Drugs Inspection Bureau for approval of CaReS. First sales of CaReS products are expected in 2008.

After that, the new business plans to establish regional offices in Beijing, Shanghai and Guangdong. The plan is to supply markets in parts of Asia and in Russia, as well as in China.

For further information, contact: Bob Guilleaume, Chief Executive, Arthro Kinetics plc, Registered Office, 123 Deansgate, Manchester M3 2BU, UK; or: Head Office, Life Science Centre, Esslingen, Schelztorstrasse 54-56, 73728 Esslingen, Germany; tel: +49-711-305-110-70; fax: +49-711-305-110-80; E-mail: info@arthro-kinetics.com